A little competition is good, right? According to local media sources in Seattle, U.S., Chinese e-commerce firm Alibaba might be considering the West Coast city as the location of its new U.S. headquarters, which is practically the backyard of its closest American rival, Amazon.
Jamie Boyd, managing director of Cascadia Capital, Seattle’s largest investment bank, told the Puget Sound Business Journal this week that he had “heard through multiple sources” that Alibaba will set up shop in Seattle, which, he said, “would be a very interesting move given Seattle is home to their largest western competitor, Amazon.”
Alibaba opened a small recruiting office in downtown Seattle last October, with a lease that runs through the end of 2015, the Journal said. From there, Alibaba reportedly has been actively poaching engineers from both Amazon and Microsoft, which is also based in Seattle, one of the key technology hubs in the U.S.
Additionally, rent in Seattle is still cheaper than the San Francisco Bay Area, another technology centric U.S. region. Class A office space last year was about US$36.50 per square foot in Seattle versus $67 per square foot in San Francisco. The Journal reported that Alibaba has opened a cloud-computing arm in Silicon Valley, but it’s unclear if the cloud-computing business would move to Seattle if the company decides to locate its U.S. headquarters there.
But no one is saying for sure if the company officially has plans to put down roots in Seattle; Alibaba spokeswoman Candice Huang said it was the company’s policy not to comment on market rumors.
Alibaba handled more than 1.5 trillion yuan, or approximately US$248 billion, in transactions for 231 million active users across its three main Chinese marketplaces in 2013, more than Amazon and eBay together, according to Reuters. Alibaba went public in September 2014 and is listed on the New York Stock Exchange. The company raised a record $25 billion in its initial public offering, making it worth more than U.S. retailer Wal-Mart and the biggest IPO in U.S. history. The IPO also made Alibaba worth more than Amazon and eBay combined.
Unlike Amazon or Wal-Mart, Alibaba is not technically a retailer because it doesn’t warehouse any goods. Rather, its model in more like eBay because it operates two online marketplaces, called Taobao and Tmall where merchants run their own storefronts.
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